May I Make a Suggestion?
All Organizations Can Benefit
by Freda Turner, Ph.D.

It was the janitor’s idea.
The famous El Cortez Hotel in San Diego provides an excellent example of the profitability advantage of listening to employees. The hotel management decided to install an additional elevator to better serve their guests. Engineers drew up plans cutting holes through each floor of the hotel. A janitor, who was concerned with this, made the comment that this would make a great deal of mess. The janitor was told not to worry because the hotel would be closed to guests during the construction. The janitor suggested, “You could build the elevator on the outside of the hotel." At the time, this architectural concept had never been done before, but after investigation by the engineers, it proved an idea that was worth developing, and is now commonplace in buildings today worldwide. The janitor's idea saved the El Cortez lost revenue, employees from losing salary and major clean-up costs related to the construction of the new elevator.

Another organization benefited from an idea put forth by two electricians. The organization implemented the suggestion and now saves $500K annually in time needed to refuel aircraft. Another organization now saves $100M from an idea of one of their salesmen. The idea involved a change in the retail distribution process. This organization believes in listening to employees and reports implementation of about 23% of all submitted employee suggestions with an average savings of $3,500 per idea.

Employees buy an airplane with savings
One of the biggest success stories relating to employee suggestions comes from American Airlines (AA) in Fort Worth, Texas. AA ran a year-long suggestion program called "IdeAAs in Flight." At the end of the year they purchased a $50.3M Boeing 757 with the money they saved from the employee suggestion program. AA receives an estimated $55M a year from their employee suggestion program and reinvests $15M back into the employees suggestion program.

Small business wins award
USA Today, in a May 2001 issue ran an article titled, "Teams of employees search and destroy work bottlenecks." It explained how a small business, Wes-Tek, won the "2001 RIT/USA Today Quality Cup Award". The award is designed to recognize teams that best improve the quality of goods and services. The owner, a hands-on micro-manager until two years ago, would not let anyone buy as much as a pencil without his approval. He made a commitment to allow his teams to turn around the troubled company. And they did just that. They eliminated bottlenecks to productivity, reduced costs, and improved quality to the point that they won this prestigious, national Quality Award for 2001. Listening to employees and implementing good and effective teams saved this small business.

Large organizations can benefit
Last February, Southwest Airlines CEO Herb Kelleher sent a letter concerning the current fuel cost crisis to the home of every employee. “Jet fuel costs three times what it did one year ago. Southwest uses 19 million gallons a week. Our profitability is in jeopardy,” he wrote. He asked each worker to help by identifying a way to save $5.00 a day. That would, he explained in the letter, save Southwest $51 million annually. The response was immediate. A group of mechanics figured out how to reduce the cost of heating the aircraft. Another department offered to do its own janitorial work. Within six weeks of the letter being sent to the employees, this large organization found ways to save more than $2M.

State government
The Wisconsin Department of Transportation also listens to its employees. Their employee suggestion program saved the state over $10 million in one year alone. Programs such as this go far beyond the proverbial “suggestion box” – which in many organizations often stays padlocked, dusty and checked only by HR folks.

County government
Kathleen Lane, an accountant in Oakland, California County's financial services department, realized that the county had been overpaying for foster care services. They had been sending checks to foster care parents that had no kids! Along with her supervisor, they came up with a plan to recover the lost money and to prevent this from happening again. This amounted to saving the county about $152,000 annually. Small potatoes you may be thinking, but it did not end there. Kathleen and other participants of the Oakland County Employee Suggestion Program have saved their taxpayers about $3.5 million dollars in the past 8 years and saved themselves countless hours in paper work. Kathleen goes on to say, "I didn't even go into this with the idea of putting my idea up for the suggestion program. I just thought I was doing my job.” Her supervisor commented, “By listening to the people who do the work, organizations gain immeasurably in employee morale as well as through the specific suggestions we implement."

Nonprofit organization
A not-for-profit entity analyzed their purchasing procedures. Focusing on reducing acquisition costs of computer equipment, an employee found existing processes to be too slow to take advantage of the online auctions that were offering unused, but older equipment at significant discounts. He submitted a recommendation to implement an online acquisition program. Once implemented, this ability to purchase online has saved the Institute over $50K while increasing productivity with the newer computers. Another organization found they could save thousands annually using online airfare discounts over their local travel office.

The wooden suggestion box.
A shipping employee suggested switching from open-ended plastic bag that must be taped to a Ziploc type. Her motivation was to have an easier job. Her suggestion netted a $75K year cost savings, and showed other employees that management was listening. The organization then launched "Improvement Movement," a new employee suggestion program. The company has since saved approximately $340K by implementing employee suggested processes/production improvements.

Improved working conditions
When the Douglas Battery Manufacturing Company implemented an employee suggestion system to reduce workplace costs, one proposal for equipment upgrades on the assembly line cut back-injury claims by more than 40% within a year.

Self-managed teams
One of the distinct advantages of incorporating self-managed teams into the organization is that workers responsible for producing results have the freedom to develop and implement processes that save time or money. Since these are the people most intimate with the means of getting the job done, they are the most qualified to find improvements.

Are you really serious about your suggestion system?
One manufacturing organization was not serious about employee suggestions. They automated the suggestion system so that employees could submit suggestions electronically. Sadly, only ten percent of the employees at this manufacturing firm had access to or possessed computer skills. Another organization only checked the suggestion box every two months. Last time they checked, it contained only four suggestions for an organization of over 1,000 employees. To ensure continued feedback, employees need to see action taken based on or acknowledgement of receipt of their suggestion. With no feedback, employees become unmotivated and keep their suggestions to themselves.

It is unfortunate in this age where companies are paying expensive consultants to find newer, better, and faster ways of doing things, that the obvious slips right by because the company's own work force isn't consulted. According to a March 2001 article reported in USA Today, a survey developed by OfficeTeam found, “Only 38% of working men and women feel their managers are very willing to listen to new ideas and suggestions for improvement.” Some organizations do listen, and have benefited from employee suggestions: “Money can be saved in every organization if the management team operates an effective suggestion program,” says Marsha Myers of Lee Hecht Harrison, a global HR Consulting firm. Managers often overlook the company’s most valuable asset and source of information - their employees. As the economy slows, creative organizations can find new ways to drive revenue and reduce costs by seeking employee suggestions.


Freda Turner, Ph.D. is a researcher of best business practices and is affiliated with the University of Phoenix Doctoral and Graduate Studies Programs. She may be reached at fturner@email.uophx.edu.

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Copyright 2001 by Freda Turner. All rights reserved.

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